Cabinet Secretary
Matt Althoff

South Dakota Medicaid: Changes Coming Soon

Stay Informed!

On July 4, 2025, President Trump signed the Federal Reconciliation Bill (H.R.1) into law. This new law brings changes to Medicaid. All states must implement the changes in the law, which are summarized below.

Retroactive Coverage or "Backdating"

Currently: Medicaid coverage to be backdated up to 3 months prior to application.

Effective January 1, 2027: Retroactive coverage will be limited to:

1 month for adults eligible for Medicaid Expansion.
2 months for adults and children eligible for any other coverage group.

Impacted Individuals: All Medicaid and CHIP applicants

Community Engagement or “Work Requirements”

Currently: There are no community engagement or work requirements for Medicaid Expansion.

Effective January 1, 2027: Some adults enrolled in Medicaid Expansion will need to show they’re completing “community engagement” activities. This means they need to show they’re completing 80 hours a month of work, job training, community service, educational enrollment, or a combination of those.

Impacted Individuals: There are people who are excluded from this requirement.

People who under age 26 and “aged out” of foster care in any state,
People who are Native American or Alaska Native, including if they’re eligible for Indian Health Services,
People who a caregiver of a child age 13 or younger or a disabled person,
Veterans with total disability ratings,
People who are medically frail or have special medical needs (like a disability or serious or complex medical condition) that impair their ability to comply with community engagement requirements,
People who are already required to comply with SNAP or TANF work requirements,
People who are in drug addiction or alcohol treatment or rehabilitation,
People who are current or recent inmates of public institutions, and
People who are pregnant or eligible for postpartum Medicaid.

At application, if you are not excluded, you must show that you met the work or community engagement hours in the month before you applied.

At renewal, if you are not exempt, you must show that you met the hours in at least 1 month since your last renewal.

More Frequent Renewals

Currently: Eligibility renewals are scheduled every 12 months.

Effective January 1, 2027: Eligibility renewals will be:

Every 6 months for Medicaid Expansion enrollees.
Every 12 months for adults and children enrolled in any other coverage group.

Impacted Individuals: Medicaid Expansion enrollees. American Indians and Alaska Natives are exempt.

Cost Sharing Requirements for Certain Services

Currently: There are no cost sharing requirements.*

Effective October 1, 2028: Medicaid Expansion enrollees with income above 100% of the Federal Poverty Level will have cost shares for non-exempt services. This will not be more than 5% of a family’s income.

Exempt services include primary care, prenatal care, pediatric care, necessary emergency room care, Federally Qualified Health Centers (FQHCs), Rural Health Clinics (RHCs), mental health, and substance use disorder.

Impacted Individuals: Medicaid Expansion enrollees. American Indians and Alaska Natives are exempt.

*Cost sharing is not the same as post-eligibility treatment of income (PETI) cost sharing procedures for long-term care or home & community-based waiver services.

What Medicaid Enrollees Can Do Now

Make sure your preferred mailing address and phone number are up to date with DSS.
Sign up to receive email and/or text alert notifications when we send you mail in the SD BEES Customer Portal.
Contact your local office if you have questions.
Join the Recipient Listserv and visit Medicaid Recipient Communication to stay up to date.
Follow DSS on Facebook, and Instagram
Visit Medicaid.gov to learn more about upcoming changes.

What Providers and Stakeholders Can Do Now

Encourage Medicaid enrollees to keep their preferred mailing address and phone numbers up to date with DSS.
Sign up for the Division of Medical Services’ Listserv and visit Medicaid Provider Communication
Sign up for the Tribal Consultation Listserv and visit Medicaid Tribal Consultation .
Follow DSS on Facebook and Instagram
Visit Medicaid.gov to learn more about upcoming changes.

Implementing HR1: A Communications & Social Media Toolkit

The following outreach and marketing resources are available for partners to use to help inform South Dakotan’s enrolled in Medicaid about the important steps they need to take to prepare for upcoming changes.

Frequently Asked Questions

What are the new Community Engagement/Work requirements and who is affected?

Starting January 1, 2027, some adults enrolled in Medicaid Expansion will need to show they’re completing “community engagement” activities. This means they need to show they’re completing 80 hours a month of work, job training, community service, educational enrollment, or a combination of those.

There are people who are excluded from this requirement.

People who under age 26 and “aged out” of foster care in any state,
People who are Native American or Alaska Native, including if they’re eligible for Indian Health Services,
People who a caregiver of a child age 13 or younger or a disabled person,
Veterans with total disability ratings,
People who are medically frail or have special medical needs (like a disability or serious or complex medical condition) that impair their ability to comply with community engagement requirements,
People who are already required to comply with SNAP or TANF work requirements,
People who are in drug addiction or alcohol treatment or rehabilitation,
People who are current or recent inmates of public institutions, and
People who are pregnant or eligible for postpartum Medicaid.

At application, if you are not excluded, you must show that you met the work or community engagement hours in the month before you applied.

At renewal, if you are not exempt, you must show that you met the hours in at least 1 month since your last renewal.

Will aged (65+), blind, or disabled individuals be required to work?

No. These individuals are exempt from community engagement requirements.

What are the changes for noncitizens?

Effective October 1, 2026, some noncitizens will no longer qualify for Medicaid, including:

Asylees
Refugees
Noncitizens granted parole for at least one year
Certain victims of abuse or trafficking

Some noncitizens will still qualify for Medicaid (as long as they meet other eligibility criteria) including:

Most Lawful Permanent Residents (“green card holders”)
Cuban and Haitian Entrants (CHEs)
Lawfully residing Compact of Free Association (COFA) migrants
Unborn children of ineligible noncitizens

How will Medicaid enrollees know if the changes impact them?

DSS will begin notifying Medicaid Expansion enrollees who are impacted by community engagement requirements in September 2026. Impacted enrollees will be sent mail ensuring they understand community engagement requirements, exemptions, and exclusions, including ways they can verify their community engagement.

DSS always notifies enrollees of changes before they occur.

Stay informed!

Sign up for the SD BEES Customer Portal to apply or renew your coverage, upload documents, sign up for text and/or email notifications, access eligibility-related documents, and learn more about your coverage.
Make sure your preferred mailing address and phone number are up to date with DSS.
Contact your local office if you have questions.
Join the Recipient Listserv and visit Medicaid Recipient Communication to stay up to date.
Follow DSS on Facebook and Instagram

Who has to renew their coverage every 6 months?

Only individuals enrolled in Medicaid Expansion (aged 19 through 64, not eligible for or enrolled in Medicare, with income up to 138% of the Federal Poverty Level) will be required to undergo the renewal process every 6 months. Individuals who are Alaska Native or American Indian are exempt.

DSS uses information available on file and through electronic verifications to find enrollees eligible again at renewal. If additional information is needed to determine ongoing eligibility, enrollees must complete a renewal and if necessary, provide requested verifications.

What if someone no longer qualifies for Medicaid?

For the majority of individuals, coverage will not change. However, some adults who no longer meet citizenship requirements or community engagement requirements may not qualify for Medicaid.

Individuals who do not qualify for Medicaid may still be able to get health insurance, and help paying for it, through the Health Insurance Marketplace. For more information on the Health Insurance Marketplace, please call 800.318.2596 (TTY: 855.889.4325) or visit www.Healthcare.gov.

Will everyone have new copayments?

HR1 requires states to implement copayments for some Medicaid Expansion enrollees with incomes above 100% of the Federal Poverty Level, starting in October 2028.

There are limits on how much a state can require as a copayment. For example, copayments cannot be more than $35 or a certain percentage of an individual’s income. Copayments will only be required on certain services.

Individuals who are Alaska Native or American Indian are exempt from copayments.